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Auckland’s Apartment Market is Alive

By Daniel Horrobin

Activity aplenty: Auckland’s apartment market is alive – City Apartments

It’s official: the Auckland apartment market is well and truly alive, and it’s only looking to gain strength as 2020 gets underway.

Buyers are back in full force boosting confidence in the market. And we’re excited to see a noticeable lift in enquiries and sales: firstly from investors, who have been laying low for a while, and secondly from first home buyers and downsizers who are on the hunt for an affordable, hassle-free lifestyle, which Auckland’s apartment market can certainly deliver.

Although we’ve had an encouraging number of new listings, the increase in buyer demand is putting pressure on our stock levels. So our message is clear to property owners – if you’ve been considering selling but have been holding back, now is the time to go to market. With such a positive jolt in buyer activity, the growing demand is ushering in plenty of opportunities to capitalise on. So don’t miss out.

As for the rental market, things are heating up in this traditionally busy period. Students are flooding back to the city and general rental-market competition puts upwards pressure on rental prices, which is fantastic news for our investors.

All in all, the year has started in fine form with plenty of activity from both buyers and sellers lighting the market back up. So if you’d like to take advantage of the current momentum, get in touch with us via rwcityapartments.co.nz / rwwynyardquarter.co.nz or rwedenterrace.co.nz.

We’re experts in buying and selling apartments in central Auckland. 

Price battle in the supercity – realestate.co.nz

In Auckland, it was the fringe districts who saw the biggest price increases between January 2010 and December 2019. In the Rodney district, the average asking price increased by 87% from $905,770 in 2010 to $1,693,141 by the end of 2019. Waitakere City saw a similar trend across the last decade with prices increasing by 86% from $470,845 to $873,749 in 10-years. 

Over the 10-years, the average asking price in Papakura increased by 69%, Waiheke Island increased by 59% and Auckland City increased by 56%.  The average asking price increased by 48% in the popular North Shore and by 45% in Manukau. Franklin increased its average asking price by 34% over the 10-years – the smallest increase of the Auckland districts.

Double your money zone: Become an Apartment buyer – oneroof.co.nz

For certain Auckland parents, one of the non-negotiables in their house search is grammar zone, preferably double grammar zone. 

OneRoof data show that may pay off for homeowners in the capital gain they make on properties over a typical high school period, but not always.

Figures from OneRoof data partner Valocity show that the biggest leap in median price was for the Epsom Girls’ class of 2017: parents who bought in that catchment zone 2013 would have typically seen a $698,000 gain in the five year period their daughter was at school. 

The different zone boundaries between the boys’ and girls’ school zones – both cover Newmarket, Remuera, Mount Eden and Parnell, but the boys’ zone spreads to lower cost areas Eden Terrace, Grafton and the eastern edges of the city centre through to Queen Street – mean cheaper buys are possible for ambitious parents.  

“The different mix of housing stock in the boys’ zone, with apartments and townhouses, means that parents can buy a relatively cheap apartment – Grafton’s median value is around $500,000 – and still send their sons to a blue chip school,” says OneRoof editor Owen Vaughan. 

“The schools have had to strictly enforce that families actually stay resident and not rent them out once their son is enrolled. Our data show that capital gain would not be there in the lower prices, but parents are probably more interested in educational gain, not capital gain.” 

Back in 2016 when it became apparent that the intensification allowed in Auckland’s 2016 Unitary plan would add some 600 new apartments in their zones, principals of both schools did express concern that they could not keep up with population growth that would bring. 

Winners and losers over the decade :OneRoof Valocity data show that to be a wise strategy: if buyers had bought for only the typical five years of high school, they’d have done well in the 2015 – 2019 period. While median prices peaked in 2017 and then softened, last year’s pick up would give typical Boys’ Grammar owners a $255,000 capital gain.

Epsom parents would have done better between 2005 and 2009, making $128,900. But, ten years later, with prices falling in 2018, their five year gain from 2015 would be only $10,000. House prices in the Westlake zone had a similar rise and fall, netting parents in the last five years a mere $9000 gain. An earlier generation of Westlake parents buying and selling between 2005 and 2009 would have netted over ten times that, $98,000. 

In his part of town, Wallace points out that there is a changing apartment market now – smarter properties for downsizing former grammar zone parents. 

“They may become an apartment buyer, a smaller townhouse buyer, they’ve got the property in Waiheke or up north, and the cycle starts again, a new family moves in.”

Download the report HERE

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